I love my 535i. I've never driven an E34 525 so I couldnt tell you what the difference in power really feels like, but not only does the M30 have more HP its got about 40 ft.lbs more torque, which should make a significant difference. The tradeoffs are that you get worse fuel economy with the M30 and you periodically have to adjust the valves. Wide vs narrow grill is a personal decision, and I believe the 525 only had the wide grill in '95. There are plenty of decent aftermarket cupholders out there, so that is really not an issue. In the end I was faced with the same decision as you, and found the 535 simply fit what I was looking for a little bit better.